Southeast Asia poverty to surge in 'socio-economic crisis': UN

By Tom Allard
JAKARTA, July 31 (Reuters) - Southeast Asia is on the brink
of a "socio-economic crisis" caused by the COVID-19 pandemic
that could reverse decades of poverty reduction, the United
Nations has warned.
"The crisis threatens to destroy the livelihoods of
Southeast Asia's 218 million informal workers," a U.N. policy
brief released on Thursday said.
"Without alternative income, formal social protection
systems or savings to buffer these shocks, workers and their
families will be pushed into poverty, reversing decades of
poverty reduction."
The region-wide economy was expected to contract by 0.4 per
cent in 2020, it said, while remittances from Southeast Asians
working abroad were likely to fall by 13 per cent or $10
billion.
The paper urged nations to fix "fiscal termites":
budget-sapping problems like tax evasion, transfer pricing and
fossil fuel subsidies so they can deliver large stimulus
packages to help vulnerable populations and boost their
economies.
Current low oil prices provided an ideal opportunity to
reverse fossil fuel subsidies, it added.
In Indonesia, the region's most populous country, fossil
fuel subsidies in 2020 will exceed its entire COVID-19 social
assistance and stimulus measures, the U.N. report said.
As well as boosting social welfare payments, Southeast Asian
nations should prioritise higher health spending, said Armida
Salsiah Alisjahbana, head of the U.N. Economic and Social
Commission for Asia and the Pacific.
Six of the 11 countries in the region - including its two
biggest nations, Indonesia and the Philippines - received the
lowest rating for health spending on the U.N.'s five-tier human
development index. Three others were on the second-lowest tier
and the remaining two were on the middle tier.
The report covered the Philippines, Vietnam, Laos, Cambodia,
Thailand, Brunei, Malaysia, Myanmar, Singapore, Indonesia and
Timore-Leste.